A Supply and Demand Theory of US Military Policy

Since the 1970s, and especially again since the attacks of September 11, 2001, a considerable body of literature has addressed the nature, causes, and consequences of the relative decline of United States power. Of particular interest is research that suggests the US is guilty of the same kind of imperial overstretch that brought down the Spanish in the 17th century and the British in the first half of the 20th century. Imperial overstretch, or a lack of balance between militarized foreign policy commitments and the resources needed to sustain those interests has, according to some scholars, weakened American power abroad by placing too many demands on the US armed services and scattering them about the globe. I discuss the literature on US foreign policy and hegemonic decline to sort out the various arguments, and to begin to identify the key issues and terms. I argue that one of the reasons why there has been insufficient theoretical progress in this debate is that its terms have been variously and ill-defined. I seek to remedy this problem by developing a model of US foreign policy that provides a clearly defined set of explanatory factors that will allow us to assess the relative impact of demand factors, such as international threats, and supply factors, such as the resource base of the US government. I test the model using time series analysis on US military policy data that span the Cold War and post—Cold War era and find that many of the arguments advanced by the imperial overstretch theorists are not supported.